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Banking (Special Provisions) Bill

The noble Lord will recognise the intensive interest in Northern Rock that the Treasury has been obliged to take over the many months since the crisis first developed. Of course the Treasury is and has been in a position to know fully the issue with regard to Northern Rock, its asset base and its book value. That is why we have been able to make the assertions that we have made on the security of the loans that have been made and the basis of the taxpayers’ support. If the noble Lord is suggesting that the Treasury would do anything else except apply the highest level of diligence to this exercise, I can only state that this has been a significant issue for the Treasury for a considerable period of time. We hoped that the issue would be resolved with a private sector deal, but there was always a possibility that the bank would come into the public sector. That is why necessary work was carried out on the preparation of possible legislation, as noble Lords have been quick to point out. That hard work was done in the hope and expectation that it would be located in the private sector. When that failed, the Government, of course, had their full analysis of Northern Rock to hand.